my llc owns 2 rental properties do i include the rent payment in the business income

[ppride2018]

do i include rental income in my business income on schedule c or only enter on schedule e

[Anonymous_ · Accepted solution]

Schedule E unless you provide substantial services (see link below) to your tenants or you are a real estate dealer.

https://www.irs.gov/publications/p527#en_US_2020_publink1000234065

[Mike9241]

if it is a single-member LLC that does not provide substantial services to the tenants like housecleaning, meals, etc (like an Airbnb), then each property gets reported in its own column on schedule E. 

a multimember LLC would need to file a partnership return and the k-1 tax info would then be entered in each member's 1040

SITUATION WHERE SIGNIFICANT SERVICES ARE PROVIDED 

Rental of a fully furnished vacation property via an online rental marketplace, similar to Airbnb or Vrbo. The taxpayer provides linens, kitchen utensils, and all other items to make the vacation property fully habitable for each occupant. In addition, the taxpayer provides daily maid services, including delivery of toiletries and other sundries. The IRS holding in this s is that the income is included in determining self-employment tax because the taxpayer provides substantial services beyond those required to maintain the space in a condition suitable for occupancy. The services go beyond those clearly required to maintain the space in a condition for occupancy and are of such a substantial nature that the compensation for these services can be said to constitute a material portion of the rent. then a single -member LLC would report the activity on schedule C while a multipmeber LLC filing a partnership return would use page 1 of the return.